by Kirsten Forrester, General Manager of Matrix on Board for NSW
I have a lingering suspicion that I’m seen as a bit of a mercenary in the non-profits I’ve worked in, because I get and love the money side of things. I try and ignore that suspicion though, because I know that I always do what I see as being in the best interests of the organisation. But there you go – I confess that I care about the money side of non-profit business; and I confess because I know a lot of people working in non-profits, at all levels, don’t care or understand so much about the money side of the business because their passion and skills are on the service delivery side of the business. So I want to tell you a story about how the two sides of the business are two sides of the same coin.
I bit my tongue (as my dear old dad would have advised) at an in-house conference once when one of the front-line, on-the-ground, with-the-clients staff said “it’s great not to be measured on a balance sheet – it’s the smiling faces that tell us we’re doing a good job”. She was delighted to feel that she worked for an employer who didn’t count every cent. I was horrified to think what state the place would be in if the bean counters weren’t, er, counting the beans.
Absolutely, smiling faces tell us we’re doing a good job – but those smiling faces are also reflected in the balance sheet. When a service has ’smiling faces’, the people preparing and analysing the financial reports can see that clearly. They see your client numbers/service delivery figures are high, they see that staff turnover and absenteeism are low, and they see expenditure within budget. There are lots of factors that impact on clients’ smiling faces, and most are measurable through your financial reports.
Having great staff being led and supported by a great manager is key to a successful organisation – the $ measures of this include low turnover and low levels of absenteeism. You can measure this by looking at sick leave as a % of total hours worked, and by calculating the cost of staff turnover. Turnover – losing an employee – is an expensive business. The cost of recruitment and training, temporary staffing, plus the loss of corporate knowledge and relationships with clients all add up. In fact a quick turnover calculator from Business Victoria estimates a turnover cost of approximately $16,000 for a $49,000 position – as a rough guide that’s about 33% of the annual salary of the position. Have a go yourself here: http://tools.business.vic.gov.au/Calculators/FormVersion/Retention.aspx
I was raised by bookkeepers – I can’t help wanting to know how much things cost – so I’m delighted to work for an employer where providing our clients with accurate, clear and understandable financial information is one of our specialities. I’m even more delighted that our other specialities are in supporting organisations in their back office and management functions that ensure that those smiling faces can keep getting great service, from great organisations who – with strong management and good information available to decision-makers – are going to be around for their communities well into the future.
